The creation and trading of NFTs have become the main on-chain activities in current major blockchain ecosystems. According to information shared by Etherscan, 95% of on-chain transaction activities in mainstream EVM blockchains in the past few weeks are related to NFTs.
Etherscan further notes that compared to the past method of issuing meme coins through the ERC20 token standard, the cost of deploying/minting/transferring tokens on the EVM is lower when engraving NFTs, as text data is written into the Input Data.
However, Etherscan also points out that NFTs on Ethereum are quite counterintuitive, as these NFTs rely on third parties to index these transactions and apply token rules. In other words, while engraving on Ethereum provides a different way of handling token-related operations than smart contracts, this method is not as intuitive or efficient in automating and decentralizing the execution of token rules as smart contracts.
Although from a technical and application perspective, NFTs on EVM blockchains may not be intuitive, this issue has not been the focus of concern for retail investors. Since mid-November, NFTs have been frequently created on EVM chains, leading to a surge in on-chain activities and a significant increase in gas fees, affecting the normal operation of some networks (such as Arbitrum).
Etherscan believes that in a way, NFTs, besides causing speculation, can also be seen as a stress test for blockchain and infrastructure providers to assess their limitations.